Cross-Chain Sealed-Bid Auctions Using Confidential Compute Blockchains

2025-10-22

AI Summary

Centralized sealed-bid auctions are vulnerable to manipulation, while public-blockchain implementations face a fundamental tension between privacy and verifiability. This paper proposes a cross-chain sealed-bid auction protocol that reconciles these requirements: confidential computation is performed on a TEE-enabled blockchain to guarantee bid confidentiality; settlement and execution occur on permissionless public blockchains (e.g., Ethereum) to ensure decentralization and on-chain verifiability; and lightweight cross-chain communication—deployed on SUAVE—enables trustless, single-round, low-overhead end-to-end operation via commitment-based fund escrow addresses. To the best of our knowledge, this is the first design that simultaneously achieves strong privacy, full verifiability, and scalability without modifying underlying consensus protocols or sacrificing compatibility with existing infrastructure. Experimental evaluation demonstrates excellent real-world performance.

Technology Category

• Game Theory and Economic Paradigms: Auctions and Market-Based Systems
• Multiagent Systems: Mechanism Design
• Search and Optimization: Distributed Search

Application Category

• Security and Privacy: Blockchains and distributed ledgers
• Economics, Online Markets and Human Computation: Economic aspects of blockchain and cryptocurrencies
• Responsible Web: Data and user privacy-enhancing technologies for the Web

Abstract

Sealed-bid auctions ensure fair competition and efficient allocation but are often deployed on centralized infrastructure, enabling opaque manipulation. Public blockchains eliminate central control, yet their inherent transparency conflicts with the confidentiality required for sealed bidding. Prior attempts struggle to reconcile privacy, verifiability, and scalability without relying on trusted intermediaries, multi-round protocols, or expensive cryptography. We present a sealed-bid auction protocol that executes sensitive bidding logic on a Trusted Execution Environment (TEE)-backed confidential compute blockchain while retaining settlement and enforcement on a public chain. Bidders commit funds to enclave-generated escrow addresses, ensuring confidentiality and binding commitments. After the deadline, any party can trigger resolution: the confidential blockchain determines the winner through verifiable off-chain computation and issues signed settlement transactions for execution on the public chain. Our design provides security, privacy, and scalability without trusted third parties or protocol modifications. We implement it on SUAVE with Ethereum settlement, evaluate its scalability and trust assumptions, and demonstrate deployment with minimal integration on existing infrastructure

Problem

• Solving privacy-verifiability conflict in blockchain auctions
• Eliminating trusted intermediaries for sealed-bid mechanisms
• Enabling confidential bidding while maintaining public settlement

Innovation

• Uses TEE-backed confidential compute blockchain
• Generates escrow addresses for binding commitments
• Verifiable off-chain computation for winner determination